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"I wanted to point out once again the colossal incompetence of central banks around the world. With inflation running at between 7% and 12% and with interest rates remaining far below the rate of price increases we should contemplate a scenario similar to the 1970s when with interruptions inflation and interest rates rose. When comparing the current time to the 1970s, I need to point out to some important differences. In the early 1970s, assets were relatively inexpensive compared to the current period. Debt levels were relatively low. The global financial market was relatively small compared to the global economy. Now, the opposite is true. Gold, oil and other commodities were extremely depressed (this is not the case today). Compared to assets, wages were relatively high. And to be fair to the US Fed, it increased interest rates with inflation. [At the time central bankers were more honest than they are today.] Already in 1969, the ten-year Treasury yield reached over 9% and in 1974, close to 13%. But even with these punitive interest rates inflation kept on accelerating. How could we now expect inflation to cool down when central banks today are already talking about slowing down the rate at which they intend to increase rates???? "
aus https://www.gloomboomdoom.com/
Marktkommentar November.
"I wanted to point out once again the colossal incompetence of central banks around the world. With inflation running at between 7% and 12% and with interest rates remaining far below the rate of price increases we should contemplate a scenario similar to the 1970s when with interruptions inflation and interest rates rose. When comparing the current time to the 1970s, I need to point out to some important differences. In the early 1970s, assets were relatively inexpensive compared to the current period. Debt levels were relatively low. The global financial market was relatively small compared to the global economy. Now, the opposite is true. Gold, oil and other commodities were extremely depressed (this is not the case today). Compared to assets, wages were relatively high. And to be fair to the US Fed, it increased interest rates with inflation. [At the time central bankers were more honest than they are today.] Already in 1969, the ten-year Treasury yield reached over 9% and in 1974, close to 13%. But even with these punitive interest rates inflation kept on accelerating. How could we now expect inflation to cool down when central banks today are already talking about slowing down the rate at which they intend to increase rates???? "
aus https://www.gloomboomdoom.com/
Marktkommentar November.
